City’s tax freeze ending with 3.5-percent property tax increase

The city’s preliminary 2012-14 operating budget is calling for an end to 14 years of property tax freezes in Winnipeg.

The budget unveiled by the executive policy committee (EPC) includes a 3.5-per-cent property tax increase, which translates into $48 more in annual taxes for a home valued at $235,000.

“For 14 years we held the line on property taxes to ensure we keep Winnipeg competitive and affordable,” said Mayor Sam Katz.

“However, without any new revenue sharing formula or a larger share of the $8.8 billion already collected from Winnipeg taxpayers, we are left with few options for how to meet our ever increasing costs.”

Earlier, Katz told WinnipegREALTORS® that the city only receives eight-cents out of every dollar collected in taxes by the province.

Katz said it is necessary to increase property taxes to keep providing services that Winnipeggers want.

Even with the tax increase, Katz said Winnipeg property taxes will still be among the lowest in Canada, and the city will continue be among the lowest in operating costs.

The tax increase will be used to improve public safety, repairing city streets and for investment in community centres, according to the EPC.

Additional funding will be allocated to clearing snow from backlanes, pedestrian routes and bike paths.

Police and fire-paramedic services make up 41 per cent of the city’s budget, while infrastructure — roads, sewer and drainage — the next biggest item, makes up 24.9 per cent of annual operating costs. Parks, recreation and libraries make up 12.5 per cent of the budget.

The police and fire-paramedic budgets increased by $30 million. The two departments now cost $375 million to run.

The budget also includes $15 million in savings by delaying filling vacancies, eliminating duplication and better methods of delivering services.

“Each year,” said Councillor Scott Fielding, the chair of the city’s standing committee on finance, “we look at every aspect of our budget and try to find better ways of managing our operations, and while we have identified $15 million in savings this year, we will continue to review all our operations to ensure we are making the best use of taxpayers’ dollars.

In addition to the 3.5-per-cent property tax increase, there is a proposal in the 2012 Water and Sewer Rate Report for an increase in the sewer rate by 0.13 centres per cubic metre and an increase in the block 1 water rate of one-cent per cubic metre.

The two increases would be the most recent in a series to pay for the $1.8-billion cost of the city’s 30-year waste-water upgrade mandated by the province.

According to the city, the water rate increase is also necessary to keep up with inflation and move towards a uniform rate for all classes of customers.

With the increase, the cost of Winnipeg water and sewer services would be a third of a penny per litre.

Last year’s increases were 0.5 cents per cubic metre for the block 1 water rate and 0.06 cents per litre per cubic metre for the sewer rate.

The average Winnipeg homeowner will face an extra $50 on their sewer-and-water bill.

“Even with these increase,” said Diane Sacher, the director of the city’s water and waste department, “our residential water and sewer rates remain competitive and are the third lowest among comparable Canadian cities.”

The rate increases will be considered by the standing policy committee on public works on March 5.

The operating budget will be reviewed by various committees and go before the entire city council for its approval on March 20.